Cyber Insurance Premiums are Increasing: How to Prepare 

Quick Summary: 

• Cyber insurance is getting more expensive due to the rise in attacks. 
• Insurers are demanding better cyber security before they’ll offer cover. 
• Preparing now can help you reduce costs and limit the impact of future breaches. 
• Even basic protections, like multi-factor authentication and staff training, can make a difference. 

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Why are cyber insurance costs increasing? 

Cyber insurance is no longer a specialist add-on; it’s become essential for many UK businesses, especially with ransomware attacks and data breaches on the rise. Unfortunately, this increased demand comes with a catch: higher premiums. 

The evidence is clear: from the onslaught of headlines about cyber-attacks to the hard data, it all points to the fact that UK organisations, especially in retail and financial services, are facing significant increases in their cyber insurance costs. This is largely because insurers are seeing more frequent and more costly claims. To manage their exposure, they’re passing the costs onto policyholders. 

But it’s not just about price. Insurers are also being more selective. They’re tightening up the criteria for cover, requiring businesses to demonstrate that they have robust cybersecurity practices in place. If you can’t prove that you’re managing your risks, you might find your options limited or be refused cover entirely. 

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What are insurers looking for? 

Today’s cyber insurance providers expect more than a tick-box approach. They want to see that businesses are taking security seriously. Not just for show, but in practice. 

Typically, insurers will ask about your technical defences, like whether your systems are patched and up to date, and whether you’re using protections like firewalls, endpoint security tools, and encryption. But they’ll also want to know about your people and processes. 

• Do you train your staff to spot phishing emails?  
• Do you have a plan for how to respond if something goes wrong?  
• Can you prove that you back up your data regularly and securely? 

If you’re working toward recognised standards, such as the Cyber Essentials scheme or ISO 27001 – that’s even better. These frameworks provide clear, structured ways to demonstrate your commitment to cyber resilience. 

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Simple steps to reduce your risk and your premiums 

Even if you’re not ready for full certification, there are some straightforward improvements that can help both your cyber security and your insurance application. 

Start with multi-factor authentication (MFA). It’s one of the easiest and most effective ways to protect user accounts, particularly those with access to sensitive data or admin controls. 

Regular staff training is another key area. Many attacks begin with a single email, so helping your team recognise suspicious messages can stop problems before they start. You don’t need to become a cybersecurity expert overnight – just building basic awareness can go a long way. 

Backing up your data securely. Any backup is better than no backup, but not all backups are created equal. Using off-site backups ensures you have a copy stored away from your systems, should they get attacked. And having immutable backups ensures that hackers cannot access and change your backup data – a technique they use to hold you to ransom.

Limiting user privileges. You are only as secure as your weakest link in the chain. If one of your team members logs into your system on a compromised device, or public wifi, they might open the door to an attack. However, if that user only has limited privileges, then any attack is contained.

Keeping software up to date. This is a common mistake we all make. Leaving the office and not wanting to update your system software, or letting a software license expire. These are the fundamental ways software developers keep us safe, so ensure you update as soon as a security patch is available.

Passwords, password managers, and/or passkeys. This gets more secure the more you move up the chain. A robust password is a fantastic start; having them stored in an encrypted password manager ensures you don’t need to use memorable passwords any longer. Even better is the rollout of passkeys – password-less technology that involves you verifying your identity (usually with biometrics).

Together, they show insurers that you’re taking a layered approach to security. 

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Getting the most from your cyber insurance 

When it comes to buying or renewing your policy, preparation is key. Be ready to share honest, detailed information about your current security setup, including any previous incidents or improvements you’ve made. It’s also worth asking your insurer what changes could make you a lower risk – they may offer advice on how to qualify for lower premiums or broader coverage. 

And make sure you fully understand what your policy includes. Some insurers exclude certain types of attacks, like ransomware or social engineering scams, unless you’ve taken specific precautions. It’s always better to ask the awkward questions up front than to find out you’re not covered when it matters most. 

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As cyber threats continue to grow, insurance is one of the many tools businesses can use to protect themselves, but remember it’s not a silver bullet. The more you invest in prevention, the more options you’ll have when it comes to getting the right cover at the right price. 

Think of it like home insurance: if you’ve got locks on the doors, a burglar alarm, and working smoke detectors, you’ll usually get a better deal. Cyber insurance is no different; insurers want to see that you’re looking after yourself before they agree to cover your organisation. 

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Worried about your own levels of cyber security? Now is always the best time to act, as tomorrow is often too late. Speak with Trustco today about your cyber setup and discuss solutions that fit any size, scale and budget.